IBM snaffles Congestion Charge contract

Transport For London (TfL) has awarded a contract to IBM to manage the systems that run the Congestion Charge and Low Emission Zone schemes in London.

The existing contract with Capita runs out in two years' time, when payment channels and customer contact facilities will switch to IBM. The technology company's consortium partner NCP services, will handle enforcement of the charge.

The size of the deal has not been divulged, as the contract is not officially ratified until early December, however Capita has quoted its revenue from the contract as £56m per year.

The contract is for five years with an option to extend for a further five years.

According to a TfL spokeswoman, IBM was selected as the preferred bidder because it was economically advantageous but also because of its experience in similar schemes in other countries and it will be involved in improving the Congestion Charge proposition.

She said: "We have received requests from customers who want more flexibility in the service, especially in respect of automated payments."

One of the projects TfL is considering is the use of 'tag and beacon' technology to make payments automatic when a commuter's car enters the Congestion Charge zone.

IBM was involved in a tag and beacon trial in Stockholm in 2006 which covered 24km of the city, affected 350,000 car journeys per day and reduced car traffic by 25 per cent. According to the company, the city's bus timetables had to be redesigned because of the increased average speed of journeys. The trial allowed the city to vary charges throughout the day, with drivers paying the charge through a direct debit account as they passed the beacons.

Capita won the initial £230m contract back in 2002. Click here to view the photos from when silicon.com was granted exclusive access to the high-tech control centre behind the London Congestion Charge.